In business transactions, money orders are a very important payment and settlement tool. It provides a safe and convenient way for both parties to the transaction to ensure the payment of money and the delivery of goods. This article will give you a detailed introduction to the types of commercial bills of exchange and illustrate them with examples to help you better understand this concept.
1. Definition of commercial bills.
First of all, we need to clarify what a commercial draft is. A commercial draft is an instrument issued by the drawer, and the payer is entrusted to pay a certain amount unconditionally to the payee or bearer on the specified date. It is a valuable ** that can be circulated in the market as a means of payment.
Second, the types of commercial bills.
According to different classification criteria, commercial bills of exchange can be divided into various types. Here are a few common ways to categorize:
Classified according to different acceptors
Banker's Acceptance: The bank acts as the acceptor to accept the bill of exchange. This kind of bill of exchange has a high degree of creditworthiness because the bank, as a financial institution, has a strong credit background.
Commercial Acceptance Bills: Enterprises or individuals act as acceptors to accept bills of exchange. The creditworthiness of such bills of exchange is relatively low and depends on the creditworthiness of the acceptor.
Classified according to different payment terms
Demand bills: A money order that is payable at sight without waiting for a specific date.
We have a usance bill: A bill of exchange that is paid on a specific date or after a specific event has occurred.
Classified according to different ticket issuers
Bank draft: A money order issued by a bank and is usually used for international** or large payments.
Commercial bills: A bill of exchange issued by a business or individual for day-to-day business transactions.
3. Example introduction.
In order to better understand the types of commercial bills, we can illustrate them with the following examples:
Example of a banker's acceptance:
Suppose Company A purchases a batch of goods from Company B, and the parties agree to use a bank acceptance draft to pay. Company A applied to its bank for the issuance of a bank acceptance draft, and after the bank passed the examination, it accepted the bill of exchange and promised to pay the money to Company B unconditionally on the maturity date of the bill. In this way, Company B can deliver the goods with peace of mind because the bank provides credit protection as the acceptor.
Example of a commercial acceptance bill:
Suppose that Company C purchases a batch of raw materials from Company D, and the two parties agree to use a commercial acceptance bill to pay. Company C issues a commercial acceptance draft to Company D, promising to pay the money on the due date of the bill. However, the creditworthiness of such a bill of exchange depends on the creditworthiness of Company C. If Company C has poor credit, Company D may be concerned that it will not be able to receive the money when the bill of exchange is due.
Examples of demand bills and usance bills
Company E purchased a batch of equipment from Company F, and the parties could choose to pay by demand or usance bills. If a demand draft is chosen, Company E needs to pay Company F immediately; If you choose a usance draft, Company E can make the payment within a certain period of time after the equipment is delivered, such as 30 days, 60 days, etc.
Commercial draft is an important payment and settlement tool in commercial transactions, including a variety of types to meet the needs of different transaction scenarios. By understanding the characteristics and usage scenarios of various commercial bills, both parties can choose the most suitable payment method to ensure the smooth progress of the transaction.